Joint life insurance

If you are a young couple in good health, joint life insurance is likely to be cheaper than buying two single policies. 

However, in instances where one partner is a higher risk to insure – being considerably older or with a history of medical issues – a joint policy might end up being more expensive than two single policies. 

It’s also important to remember that joint policies will only pay out once despite covering two people. So, buying two single policies may sometimes be worth the extra cost to provide an additional benefit to support any children or loved ones. 

When applying for a life insurance policy, there are a few questions that you’ll need to answer. These include: 

• The full names of you and your partner 

• Your date of birth 

• Your occupation 

• Your medical history 

• Smoker status 

• Your mortgage value (if you’re applying for mortgage life insurance) 

 It’s important that both you and your partner answer these questions as honestly and accurately as possibly. Failing to do so may put you at risk of your claim being denied if your provider suspects that you have provided fraudulent information.

In the unfortunate situation where both people named on a joint life insurance policy die at the same time, the life insurance will be paid out to a beneficiary.

Typically, the primary beneficiary of a joint life policy is the other person named on the policy but you can have multiple beneficiaries named on a policy. A policy without a beneficiary may be held in probate, which can delay the pay-out being sent to the right people.

For couples with children, it's common that they would name their children as beneficiaries on their life insurance policy. However, insurance companies will not directly give the pay-out to any child under 18. Instead, it will be given to a guardian that has been appointed in your will. They will then be responsible for managing the money until the child is 18.

The simplest solution to this issue is to have your life insurance pay out into a trust with a named trustee in charge of managing the funds. Trustees are usually family members, close friends, or legal professionals who will distribute the funds according to your wishes.

If you take out your policy as a married couple and then divorce, your insurance will still cover both parties unless you contact your provider to change the terms manually.  

If you and your partner separate during the term of a joint life insurance policy, the cover can’t be divided. You can ask your insurer to split the policy into two separate policies, but that is done at their discretion. 

Your insurer will no doubt apply terms and conditions to separating a policy. For example, they may ask you to inform them within six months of the separation. Be prepared for your monthly premiums to increase, and you may well be asked to update your health and lifestyle information. 

Alternatively, in the case of separation, many providers offer the choice for one party to take over the policy. From then on, they will be solely covered by the policy, and it will be up to them to pay the premiums.

Second death joint life insurance policies will pay-out only after both people named on the policy have died. This is different to first death policies, which will pay out when the first person has died.

First death policies are typically used to help support the surviving partner whereas second death policies are usually intended to pass on larger estates to children or family.

You can cancel your life insurance policy at any time by contacting your provider. There is usually a cooling-off window of up to 30 days where you can cancel and receive a refund for anything you have paid. After the cooling-off period, if you cancel your policy your premiums won’t be returned, and some providers may charge a cancellation fee. 

Yes, joint life insurance can be taken out by couples that aren't married. The terms of the policy won't change if you and your policy partner aren't married, although you will need to make sure that the pay-out goes to the right people by either naming them as your beneficiary or writing the policy in trust.

Because the lump-sum of a life insurance policy is tax free, it can be beneficial to more than just families. Business partners, for example, can use a joint life policy to maintain their business if one of them passes away. Friends with joint financial commitments like a mortgage can also use a joint policy to pay off the debt.

Yes, a joint life insurance policy can be put into a trust. Some life insurance policies are automatically written in trust when you apply for them but in other cases you may need to set it up yourself.

There are a lot of benefits to having your life insurance written in trust, including avoiding probate and inheritance tax.

To find out how trusts work with a life insurance policy, read our guide 'Understanding the role of trusts in life insurance'.

In many cases, you can still take out joint life insurance if you're over 50. However, most providers of regular or joint life insurance have age limits for when you can apply and the maximum term of your policy.

Maximum entry age to apply for regular joint life insurance can range from 60 to even 80 years of age for some providers, but you will be required to provide information about your medical history when applying for these policies. If you are over 50 years of age and have pre-existing medical conditions, there is a possibility that you may not qualify for regular life insurance cover.

If this is the case, there are other options available. Over 50s life insurance is a type of policy that offers guaranteed cover without medical checks. This type of policy can only be purchased for individuals and because of its cost may not be suitable for everyone.

Yes, it is possible to take out life insurance on your partner but there are some conditions to this.

If you are taking out life insurance on behalf of another person, you will need to demonstrate that you have 'insurable interest'. This means that you would have provable financial loss if they passed away. This is something that would need to be recognised by the law.

For example, you would experience a financial loss if you own a shared mortgage or were joint owners of a business, and so would have a viable reason for taking out a life insurance policy.

However, you need consent from the other person to take out life insurance on them and in most cases will need a financial advisor to set up the policy as it cannot be applied for in the same way as a standard life insurance policy.

Same sex marriages and civil partnerships are legally recognised in the all parts of the UK, so setting up a joint life insurance policy works in the same way for LGBTQ+ families as it would for heterosexual and cisgendered couples. The other partner on the policy would be the primary beneficiary and the pay-out would typically go to them, regardless of gender or marital status.

If you want the pay-out of the policy to go to someone other than the other policyholder, you will need to name them as a beneficiary or set up a trust with instructions for the trustee on how to distribute the funds.

Joint life insurance is a good choice for new parents as it makes sure you're both covered under one policy. This means you only have to pay one monthly or annual premium and you would both be covered until one of you died.